Quadrangle-Backed Maxim Mag May Be Turned Over to Creditors

Rafat Ali

Nov. 22, 2008 - 1:26 AM PDT
Nov. 22, 2008 - 1:26 AM PDT

Alpha Media, the Quadrangle-owned media company that is holding for Maxim Magazine and Blender, may be turned over to the creditors, reports WSJ, another bad sign for the media investment fund by Steve Rattner. Last week came the news that Quadrangle was closing down its media hedge fund.

Things have been bad at Alpha, and it has been forced to violate debt covenants, the story said. The largest lender to Alpha is PE firm Cerberus Capital Management, and is central to the restructuring talks, which could fall apart. Quadrangle bought Maxim and Blender from its parent Dennis Publishing USA last year, for about $250 million. Since then, its EBITDA has taken a nosedive, from about $28 million then to about $8 million that it is expected to generate this year. Kent Brownridge, who was brought in as the CEO when Alpha got acquired, left earlier in August. The digital head Doug Warshaw, who joined in fall last year, left after a few months as well.

Earlier this year, Quadrangle attempted to acquire market researcher Greenfield Online, but *Microsoft* ultimately won. Last year, Quadrangle brought on former *Yahoo* COO Dan Rosensweig to start its Silicon Valley office, and among other things he tried to take a stake CNET before it was bought by *CBS*. Keeping in mind Quadrangle’s troubles, how long before Rosensweig leaves? His name has been brought up in connection with the hunt for a new CEO of *Yahoo*, but if that doesn’t happen, well….